 Create a deferred tax liability for estimated future taxes payable, and/or create a

deferred tax asset for estimated future tax refunds, that can be attributed to temporary
differences and carryforwards
 Calculate the total income tax expense in the period
Applicability of tax accounting
Every entity is required to engage in tax accounting. This includes individuals,
corporations, sole proprietorship, partnership, and every variation on these entity
concepts. Even nonprofit entities are required to file annual informational returns, so
that the IRS can determine whether these organizations are complying with the rules
for tax-exempt entities